For decades, McDonald’s was the most popular fast food chain in America, a place where families and children could enjoy a meal at affordable prices. But those days are long gone. Now, the soaring cost of several menu items is making the company lose millions of customers and billions in sales every year, resulting in worrying cash flow problems that are accelerating its collapse in the very industry it helped to create. In this video, we explore some of the reasons why the world’s largest burger flipper is losing momentum and falling apart in the US market as the brand continues to lose its essence.
May was yet another month where a wave of customer defections hit several McDonald’s restaurants across the US. In nine of the past 10 months, the burger flipper reported losing customers in the United States, and a new analysis reveals that has everything to do with its new pricing strategy.
In April, McDonald’s announced price increases on a number of menu items for the second time in a single quarter. The company noted the decision came amid rising commodity prices and labor costs. The last price hike was seen on February 15, when it raised the cost of five combos by a dollar. But indicators show that consumers are getting fed up with higher costs at McDonald’s restaurants. In the first quarter of 2023, the company reported an average price increase of about 10% in its US locations when compared to the same period of the prior year.
Although executives said that higher menu prices are helping the company to boost earnings and revenue, analysts argue this is also shrinking the chain’s customer base, which will ultimately hurt its bottom line.
Even though same-store sales have risen over the past decade, higher average checks drove these numbers, not customer visits. “How many millions of lost customers will it take before McDonald’s really focuses on reversing this risky trend?” asks Forbes contributor, Larry Light.
He predicts that for the company to increase revenues relying on average checks on a shrinking customer base will require the average customer to spend $20 per transaction. This troubling pricing strategy is accelerating the brand’s downfall. During a call with investors, the CFO highlighted that McDonald’s cannot survive with declining customer counts. Corporate knows that it’s impossible to maintain a chain that operated 38,000 stores across the globe on a shrinking customer base. Still, nothing has been done to prevent this from happening.
Considering its enormous operations worldwide and the conditions that led the company to become a huge success, it is very odd to see that instead of investing in keeping and growing its base of customers who can afford to regularly frequent its restaurants, the brand is focusing on gaining a public that already has hundreds of options of higher priced burger chains out there.
In an industry that is getting more and more competitive with each passing year, being one of the largest and oldest chains in the market is not a synonym for success and growth anymore. Businesses have to adapt constantly and, more importantly, value the customers that they already have. The fall of McDonald’s is a self-inflicted crisis that will spark major repercussions for the company in the near future. And that means America’s most iconic fast-food chain is at serious risk of collapsing all around us, and its downfall will be very painful to watch.
Article and video via Epic Economist.
Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
Headline grammar!!!!!!!!!!
The peopleless ordering system, horrible WiFi, no peanuts, perpetual broken ice cream machines, no more self-service drinks… There’s plenty of reasons in addition to the high prices that I no longer go to McDonald’s.
McDonald’s is still by far the cheapest compared to other fast food restaurants. McDonald’s parking lots are still filled with more cars than many other restaurants. Sorry, but the sandwiches at these other places are ridiculously crazy expensive. So what? McDonald’s can’t raise their prices? Only other places can? Ground beef is outrageous in the grocery stores! Everything is! Is that McDonald’s fault too? Look to DC for that answer.
Dude you love McDonalds… I’ve never seen such a strong defense of literal Garbage..
I really hope that Big Mac you’ll be getting later is tasty..
How about the fact that the food is incredibly processed, terrible for human consumption and fake. There is literally no comparison to what a McDonald’s hamburger tasted like 30 years ago. The entire menu is fake food.
But I digress. All fast food is pretty much the same.
The only thing that gets sacrificed in the fast food biz is food quality. Hence the reason we buy beef by the half or full side and grill out on either our blackstone or Traeger daily during the summer. Haven’t had need or desire for garbage food for years.
In-n-Out Burger is an exception to the fake food rule. Even their fries are cut fresh by hand.
McDonald’s used to be tasty garbage fast & cheap – now it’s just garbage. That’s why I don’t go.
I quit going to McDonalds a long time ago. Although their closest restaurant is just upmthe street, I would rather drive 20 minutes to my local Whataburger. Why? Because it is cheaper and the food tastes better. It’s that simple.
Don’t look at me! I’m a Wendy’s guy!
McDonald’s is really a real estate company charging rent to franchisees. I like the egg McMuffin and occasional Big Mac though. I think the cost of the infrastructure and real estate taxes are what’s hurting the chain — not the food itself. The food is fine, you get what you want if the workers do it right. That’s the other problem, unreliable workers. I feel sad for the franchisees who loved the food and the culture, but the unreliable workers and costs just killed it for them 😢😢😢
This article could use a few more solid examples to make a better case for its assertion. How much does McDonalds gross on its higher priced meals versus its budget meals? Seems the overhead would be about the same per meal, so the equation would boil down to how many budget meals must it sell to match the gross of one high priced meal? And is there enough demand for the budget meals to warrant a reduction in the price of the high priced meals? Has McDonalds dropped the budget items altogether so customers can only get the higher priced items? I suspect any revenue issues McDonalds is experiencing has more to do with staffing and wait times than prices. It was fast food when you could walk up to the window, place your order from a very limited menu, and walk away with your order in less than two minutes. Now it takes longer than that to read the menu and often you’re waiting several minutes to receive it. Maybe they need to streamline the menu and get back to basics. Waiting for fast food is an oxymoron.
Stores have even curtailed their hours . I generally am on the kob at 5am . You can rarely now find a 24hr mickey D . Am in the capital of my state and nothing is open until 8am – thats ridiculous !. And then the cost as som McD’s are $7 and others are $10 for the same breakfast meal wtf ?.
Ten percent is a modest increase given the government driven inflation. Poor service would be a bigger driver of lost customers. A friend and I stopped at a Greenville, NC Mickey D’s at 6:30AM for coffee to go on our way to a race in 2013. The coffee was rancid, tossed it. Haven’t been in a Mickey D’s since
Too much salt, the burgers don’t taste like beef, the fries don’t taste like potatoes, it all tastes like salt.
Gee Walley…do you think the meat that has the taste and texture of cardboard (where’s the beef?) or the dirty-looking, tattooed up people that serve you (which makes you doubt sanitation) could be a factor in McDonald’s demise? Chik-Fil-A is still doing OK and their food isn’t soybean laden, their facility and staff don’t look like the dregs of society, and their food costs more. However, in truth, CFA is also going downhill since the father died. And they are going to get hammered, too, if the useless son doesn’t shut his mouth…his woke talk has ticked off many customers…some I know personally who are already quietly boycotting CFA because they see the downward trend of shirtsleeves to shirtsleeves in one incompetent generation. Go woke, go broke….buddy. CFA is not immune.
McDonalds has the same problem most big companies have, they are only in business for $$$, not to provide a valuable service or product.
When ‘profit’ is more important than the service you provide, the public will take notice and vote with their feet.
Couldn’t disagree more with your conclusion and your initial proposition that all McDonald’s problems are pricing related. They are not. Is In and Out struggling? Do you think people that go to In and Out will stop going if prices for a combo go up by a buck? If not, why? Quality. McDonald’s has none. In fact there is so little of what we refer to as good in their meals that I don’t know that what they serve can legitimately be called Food any longer. Have you seen the 20 year old McDonald’s Burger that one man still has in its original wrapper? It still looks edible. McDonald’s is dying because they have been killing their brand for years with inferior “food” and a complete lack of taste. Have you tried their eggs recently? The texture is strange and it doesn’t taste like an egg. No McDonald’s is dying by suicide.
Eight something plus tax for a ten piece nugget. Nuggets are definitely not worth a buck each. I get eight piece fried chicken and four rolls for 7.99.